Fidelity's Shanghai unit has been preparing for public fund business since the beginning of this year, according to those with knowledge of the situation. The firm will apparently suspend new issues of private funds and has started selecting vendors for the public fund product.

The source said the industry expects the pilot program for wholly foreign-owned enterprises (WFOE) to sell public funds could start in 2021. However, a Fidelity spokesperson declined to comment on the matter.

The source said the industry expects the pilot program for wholly foreign-owned enterprises (WFOE) to sell public funds could start in 2021. A Fidelity spokesperson declined to comment on the speculation.

China released a wholly foreign-owned enterprise private fund management program in 2017, allowing WFOEs to step into the domestic wealth management market. Presently, there are 18 WFOE PFM companies registered, and 14 of them have had launched 31 private fund products in China.

In addition, Neuberger Berman and Fullerton Fund Management have received the first batch of licenses for foreign-owned companies to provide investing advisory services in China in March.